Societe Generale's strategist team, headed by Alain Bokobza, has adjusted its model asset allocation to reflect what it sees as a favorable backdrop for risk assets. The bank raised its recommended equity allocation to 55% from 50% in March and reduced its bond allocation to 25% from 30%.
The team cites a combination of resilient economic growth and a moderate rise in inflation, arguing that central banks are unlikely to derail the present rally. Against this macro backdrop, SocGen shows a clear preference for U.S. markets and specifically favors S&P 500 equal-weight exposure to capture the positive growth impulse while limiting concentration risk.
Geographic diversification is also part of the revised stance. Societe Generale recommends adding exposure to China, Japan and the U.K. at the index level, and explicitly added the FTSE 100, India's NIFTY and China A-shares to its list of recommended markets.
The most pronounced change in the allocation is a substantial increase to commodities, lifted to 20% from just 5%. The bank points to a global, multi-year infrastructure cycle as the main driver of sustained demand for commodities. It identifies structural tailwinds supporting this view, including electrification, defense spending, artificial intelligence development, energy independence and broader sovereignty considerations.
Within commodities, SocGen singled out gold as a tactical buy on dips. The bank framed gold as a part of the commodity reallocation, recommending investors add to positions when prices retrace.
On the equity side, the strategists highlighted a range of preferred sectors and themes for long positions. Those calls include U.S. industrials; utilities in the U.S. and Europe; banks in the U.S. and Europe; U.S. consumer cyclicals; global oil and gas equipment and services; nuclear-related stocks; and global metals and mining companies.
Overall, the reweighting reflects Societe Generale's view that a combination of durable growth and mildly firmer inflation supports higher risk exposure and stronger demand for commodities. The bank's changes emphasize U.S. equity exposure, a meaningful tilt toward commodities, and a reduction in fixed-income weighting to accommodate those increases.